Great Clips Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Great Clips is a value-focused haircut franchise serving walk-in customers with quick, no-appointment cuts in high-traffic retail centers. Franchisees run salons staffing 3 to 8 stylists on an owner-manager rather than hands-on-cutting model.
FranchiseVerdict summary · 2026
A Great Clips franchise requires a total initial investment of $188K – $420K, including a $6K – $20K franchise fee and an ongoing 6.0% royalty[2]. Per the 2026 FDD, average unit revenue was $411K[2]. SBA 7(a) loans show a 5.3% charge-off rate across 604 loans[1]. FranchiseVerdict grade: A (Strongest tier), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2026 FDD issuance
Overview
- Investment
- $188K – $420K
- 21st pct Personal Care…
- Avg gross sales
- $411K
- 7th pct Personal Care…
- Royalty
- 6.0%
- 10th pct Personal Care…
- Units
- 4,441
- 62nd pct Personal Care…
- SBA charge-off
- 5.3%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Personal Care & Beauty · color = vs category peers
Green = favorable by >10% vs Personal Care & Beauty avg · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- COSTTotal investment $188K – $420K including a $20K franchise fee, 6.0% ongoing royalty.
- RETURNSAverage unit revenue of $411K/year (median $391K), with an estimated 15% cash-on-cash return (based on Operating Cash Flow11).
- RISKVerdict A (Strongest tier), verdict score 84/100 (higher is better). SBA loan charge-off rate of 5.3% across 604 loans (near or below the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- SCALEEstablished system with 4,441 units across 43 years of franchising. Strong brand recognition and operational playbook.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Great Clips, Inc.
- CEO title
- President and Chief Executive Officer
- Robert D. Goggins
- Incorporated in
- MN
- HQ
- 4400 West 78th Street, Suite 700, Minneapolis, MN 55435
- Auditor
- Independent CPA firm, Minneapolis, Minnesota (report dated March 25, 2026)
- Audited financials
- Franchisor revenue
- $207.6M
- vs $202.7M prior year
Overview
About
- CEO
- Robert D. Goggins
- Headquarters
- MN
- Founded
- 1982
- FDD year
- 2026
- States available
- 51
Can you afford it, and what does the money buy?
Entry cost runs 42% below the typical personal care & beauty franchise.
Source: FDD 2026 · Items 5–7
FDD Item 7 · 2026 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $20K | $20K |
| Working capital (3–6 mo) | $20K | $60K |
| Equipment, build-out, other | $148K | $340K |
| Total initial investment | $188K | $420K |
Source: Great Clips 2026 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $188K – $420K
- Top 40% of category vs category
- Liquid capital req'd
- $20K – $60K
- Top 40% of category vs category
- Franchise fee
- $6K – $20K
- Top 40% of category vs category
- Royalty
- 6.0%
- percentage · typical 6–8%
- Ad fund
- 5.0%
- typical 3–5%
- Total fee load
- 11.0%
- vs 9–13% typical
- Payback period
- 6.6 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 5.0% of gross sales |
| Technology fee | $750 |
| Training fee | $200 |
| Transfer fee | $2K |
| Renewal fee | $2K |
| Inventory (initial) | $5K – $6K |
| Total fee load | 11.0% of rev |
What do units actually make?
Average unit sales run 48% below the personal care & beauty norm.
Source: FDD 2026 · Item 19
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$78K
19.0% margin
Unlevered ROIC
23%
EBITDA / total invested capital
Payback
4.4 yrs
cash-on-cash, unlevered
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
FDD-reported earnings vs. model
The FDD reports $84K as Operating Cash Flow11. Our model estimates $78K SLEBITDA from the same revenue using category-average cost assumptions. These numbers differ because Operating Cash Flow11 deducts different expense categories than our model.
What one unit earns on your invested capital
Model A · Single-Unit Return
Computes unlevered return on invested capital (ROIC) for a single franchise unit. The target band for an attractive franchise is 30–60% ROIC. Below that and a passive index fund likely outperforms; above that and the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses. It's the top line only. Operating costs below are category estimates. Override them to match your real lease quote, labor market, and build-out budget.
Returns model · single-unit ROIC
What would one Great Clips unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
23%
Below the 30–60% attractive-franchise band
What 25 units return when you use SBA financing
Model B · Return on Equity: Debt-Financed Acquisition
Models a 25-unit portfolio acquisition financed with an SBA 7(a) loan. Shows equity IRR (your return on cash invested), DSCR (how safely the cash flow covers debt service), and the capital stack (SBA + seller + equity breakdown).
This is the “search fund” or “entrepreneurship through acquisition” scenario: you buy an existing multi-unit operator, use leverage to amplify returns, and either operate or hire management. The 25-unit size is the typical minimum for an SBA-backed franchise portfolio acquisition to pencil as a full-time income.
What “return on equity” means here: if you put in $500K of your own cash and the business generates enough EBITDA to pay down debt and grow, your equity IRR is the annual return on that $500K, including the value created when you eventually sell. Target IRR for a search fund is typically 25–35%.
Levered LBO scenario · Yale Crease Capital framing
What would 25 Great Clips units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$986K
on $4.9M purchase
Total debt
$3.9M
SBA $2.5M + senior + seller note
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Item 19 · Source: 2026 FDD
Financial Performance
- Avg gross sales
- $411K
- Per unit, per year
- Median gross sales
- $391K
- Avg operating cash flow11
- $84K
- Reported as Operating Cash Flow11 in FDD Item 19
- Cash-on-cash
- 15.1%
- Based on Operating Cash Flow11 / investment midpoint
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- historical gross sales + operating cash flow (average, median, range by sales band)
- Sample size
- 4,158 outlets
- vs category median 38 · large
- Range (low → high)
- $28K→$1.1M
- Cohort dispersion (min → max)
- Reporting year
- 2025
- Fiscal year the figures cover
- Source filing
- FDD 2026
- Disclosed in the 2026 filing, covering 2025
- Transparency
- 9 / 10
- vs category median 4 / 10 · above
Compared against 179 Personal Care & Beauty brands
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Unit economics
Average unit generates $411K/year in gross sales. Revenue-to-investment ratio: 1.4x.
Fee burden
Total ongoing fee load of 11.0% — above the Personal Care & Beauty average of 7.8%.
Disclosure
Transparency score 9/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System roughly stable (+0.3% 3-year CAGR) with 4,441 units.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Personal Care & Beauty averages
How Great Clips Compares
Is the system healthy?
Source: FDD 2026 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 4,441
- Opened
- 110
- Last reporting year
- Closed
- 103
- Terminated
- 3
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 2
- Term expired, not renewed (per Item 20)
- Turnover rate
- 2.2%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Multi-unit owners
- Outlier
- Reported value implausible. See FDD Item 20
- Net growth (3-yr)
- +0.3%
- Net unit change over 3 years
- 3-yr CAGR
- +0.3%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 98
- Closed (3yr)
- 89
- Terminated (3yr)
- 3
- Non-renewed (3yr)
- 6
- Transfers (3yr)
- 164
- Reacquired (3yr)
- 0
- Franchisor bought back
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 51 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator. Not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 604
- Loan volume
- $126.0M
- Median loan
- $120K
- 50th percentile
- Charge-off rate
- 5.3%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 94.7%
- 5-yr charge-off
- 4.3%
- Loans approved 2021+
- Active lenders
- 132
- Defaults
- 27
- Typical loan rate
- 6.0%
- avg rate to borrowers
- Franchised industry avg
- 12.1%
- brand beats franchise avg ↓
- Jobs supported
- 11,046
- 9.2 per loan
- Lender concentration
- 17%
- top lender's share
Borrower mix: 44% went to startups / new businesses, 56% to established operators
Franchise vs independent — in beauty salons, franchised businesses charge off at 12.1% vs 18.6% for independents — franchising is associated with 35% lower SBA default risk in this category.
Vintage analysis
Great Clips charge-off rate by loan vintage
Top lenders financing Great Clips franchisees
Showing 3 of 132 lenders. The full breakdown — every lender, state distribution, interest rates & risk ratings — is in the SBA Lending Report below.
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Great Clips's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 10 lenders with concentration factor
- Per-state charge-off rates across 15 states
- Startup risk premium and job creation velocity
- 35-year lending trend
Instant access. No subscription.
What could kill this investment?
SBA loans charge off at 5.3% — 67% below the 16.0% national norm, i.e. lower lender-observed risk.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
Great Clips presents moderate-to-cautionary risk: a mature, stagnant franchise system with unverified financials, thin margins, and limited growth prospects despite stable brand recognition.
Litigation (Item 3)
No litigation is required to be disclosed in this Item.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Independent CPA firm, Minneapolis, Minnesota (report dated March 25, 2026)
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 84 / 100 verdict
- 01MINORSystem stagnation: 4,439 units with only 0.3% YoY growth indicates mature/declining market with minimal expansion opportunity
- 02MINORThin profit margins: 20.7% net margin leaves little room for error; 6% royalty ($23,951 avg annual) plus operating costs create vulnerability to economic downturns
- 03MINORCommoditized service model: Low-cost haircut category faces Amazon-style disruption (mail-in clipper kits, DIY trends, budget competitors)
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 11.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2026 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 10 years |
| Territory type | protected |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 1 year |
| Non-compete (miles)ℹ | 5 mi |
| Right of first refusalℹ | Yes |
| RoFR response window | 60 days |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Curable defaultsℹ | 2 |
| Mandatory arbitration | Yes |
| Arbitration location | Minneapolis, Minnesota |
| Jury trial waiver | Yes |
| Governing law | State where Authorized Location is located |
| Litigation count | 0 |
View Item 3 litigation summary
No litigation is required to be disclosed in this Item.
Items 10, 11
Training & Operations
- Classroom training
- 49 hrs
- On-the-job training
- 13 hrs
- Training location
- Online/webinar/phone, live virtual sessions, in-person in Minneapolis, MN (Building Your Legacy), and in-salon at a market salon
- Ongoing training
- Required
- Time to open
- 24 mo
- From signing to launch
- Site selection
- franchisee
- Franchisor financing
- Not offered
- Item 10
- POS system
- Innovative Computer Software (ICS) - Styleware
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Innovative Computer Software (ICS) - Styleware
Item 20 · call current owners
Franchisee Contacts
4,789 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Great Clips · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Great Clips franchise?
The total investment to open a Great Clips franchise ranges from $188K – $420K, with an initial franchise fee of $20K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Great Clips franchise owners earn?
According to Item 19 of the Great Clips FDD, the average gross sales per unit is $411K. The median is $391K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the Great Clips FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the Great Clips FDD and qualifies whose outlets they describe.
What is Great Clips's franchise failure rate?
Based on SBA 7(a) loan data, Great Clips has a charge-off rate of 5.3% across 604 loans, meaning 5.3% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many Great Clips franchise locations are there?
As of their most recent FDD filing, Great Clips has 4,441 total units in the United States, including 4,441 franchised units and 0 company-owned units. 110 new units were opened in the latest reporting year.
Is Great Clips a good franchise to buy?
FranchiseVerdict rates Great Clips as a A-grade franchise with a verdict score of 84 out of 100 (higher is better), based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
For franchisors
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.